Thursday, July 27, 2017

The latest release of the Chicago Federal Reserve National Activity Index (CFNAI) indicated that national economic activity improved in June with the index rising to a level of 0.13 from a weak level of -0.30 a month earlier while the three month moving average rose to a level of 0.06.

The CFNAI is a weighted average of 85 indicators of national economic activity collected into four overall categories of “production and income”, “employment, unemployment and income”, “personal consumption and housing” and “sales, orders and inventories”.

The Chicago Fed regards a value of zero for the total index as indicating that the national economy is expanding at its historical trend rate while a negative value indicates below average growth.

A value at or below -0.70 for the three month moving average of the national activity index (CFNAI-MA3) indicates that the national economy has either just entered or continues in recession.

The latest release of the S&P Core Logic Case-Shiller (CSI) home price indices for May reported that the non-seasonally adjusted National index increased from April with prices rising 0.97% while the non-seasonally adjusted Composite-10 city index increased 0.70% and the Composite-20 city index increased 0.81% over the same period.

On an annual basis, the National index increased 5.58% above the level seen in May 2016 while the Composite-10 city index increased 4.94% and the Composite-20 city index increased 5.69% over the same period.

On a peak basis, the non-seasonally adjusted National index recently surpassed the record high level seen prior the onset of the Great Recession rising 3.24% above the level seen in 2006 while the Composite-10 index remained -6.19% below the peak level and the Composite-20 remained -3.66% below.